Covid-19 to delay London's Battersea Power Station redevelopment?

An artist impression of the Battersea Power Station redevelopment, one of the largest regeneration projects in Europe. Image source from https://batterseapowerstation.co.uk/

Published in NST Property

The Battersea Power Station redevelopment, one of the largest regeneration projects in Europe could face a slight delay due to the Covid-19 pandemic, said sources familiar with the matter.

Sources said that whilst work has recommenced at the project last month, not all the workers are on site.

The £9 billion site was closed on March 24, just after UK prime minister Boris Johnson put the country into lockdown.

The Battersea site had over 4,300 workers before the Covid-19 crisis escalated.

UK media reported that the unprecedented large-scale stalling of projects and closure of sites like Battersea, HS2, and Crossrail due to Covid-19 had affected £26 billion worth of construction jobs in March.

Battersea Power Station Development Company Ltd (BPSDC) chief Simon Murphy said in a March statement that following the temporary closure of the site and in light of the government requirements and guidelines, the site should remain closed for a few weeks.

He promised a review of the position by April 17 and if deemed appropriate to reopen, the main site works would recommence on April 27.

Hopes that the construction site would be back up and running on April 27 were dashed with the reopening put back until May.

As a result, Apple's plan to move into its sprawling new U.K. headquarters could be delayed.

Apple is the largest tenant in Battersea Power Station and its office will account for circa 40 per cent of the total office space in the whole development.

The iPhone maker was set to move 1,400 staff from multiple Apple offices around London into the new 500,000 square foot space, which will occupy six floors of the central Boiler House inside the historic icon, in 2021.

Battersea Power Station Development Company Ltd chief Simon Murphy said it is too early to give a precise indication of the impact of Covid-19 on the development. Image source from https://batterseapowerstation.co.uk/

NST Property reached out to Murphy and was told that it is too early to give a precise indication of the impact of Covid-19 on the development.

Murphy said works recommenced at the beginning of May in stages and excellent progress has been made across the site in the past month.

"A large proportion of the workforce are back on site already with the numbers increasing every day," he said.

Murphy said whilst the site was temporarily shut, design and other offsite works continued to ensure the time is used effectively.

The project is master-planned by Rafael Viñoly Architects. It features buildings and exterior spaces designed by BIG, Gehry Partners, Foster + Partners, James Corner Field Operations, and LDA Design.

On the company's website, Murphy said it is making sure that both Circus West Village and the development of the power station and Electric Boulevard continue to run as efficiently as possible throughout this period.

"There are robust plans and procedures in place to ensure we remain resilient," he said.

Murphy said, following the temporary closure of the construction site on March 24, the company had spent a number of weeks working together with its construction managers, Mace and Sir Robert McAlpine, to test and develop new site processes that fully comply with the Covid-19 site operating procedures.

He said with the full support of the company's shareholders it will continue to deliver this iconic project through these unprecedented times and prepare to navigate the challenges ahead.

Phase 1, completed in 2017, is Circus West Village and worth an original £400 million. Image source from https://batterseapowerstation.co.uk/

Development progress

The 42-acre Battersea Power Station, poised to be one of the world's most innovative mixed-use developments is a project by a Malaysian consortium comprising S P Setia Bhd, the Employees Provident Fund (EPF) and Sime Darby Property Bhd.

The development, which anticipates 25,000 people to be living and working there, consists of eight phases, each designed by a range of renowned architects.

Phase 1, completed in 2017, is Circus West Village and worth an original £400 million. It consists of 11 blocks of apartments with 865 units housing more than 1,000 residents.

Phase 2 has about 253 units of apartments including penthouses at the main power station building, and the take-up rate is over 90 per cent.

BPSDC had targeted for Phase 2 to be completed in stages later this year.

The commercial assets (of Phase 2) is owned by EPF and Permodalan Nasional Bhd (PNB). They acquired the assets in 2019 for £1.58 million (RM8.51 billion).

Mace is carrying out work on the second phase of the scheme, estimated to be worth £1.15 billion. This phase will include retail and food space as well as an events venue and park and is due to complete by the end of this year.

For Phase 3A, also known as the Electric Boulevard, it will comprise 539 residential units with the main building, designed by Norman Foster and another three flower-inspired buildings by architect, Frank Gehry.

The residential units at Phase 3A were sold at an average price of £1,700 per sq ft, and the take-up rate is over 70 per cent.

The completion of Phase 3A is expected in 2021.

According to UK media reports, the second phase of the scheme and the third phase of the scheme had around 2,800 workers and 1,500 workers on it before the sites were shut.